Indiabulls Securities Ltd. vs Sunil Kumar Hargunani & Ors.
2014 Latest Caselaw 882 Del

$~6

*     IN THE HIGH COURT OF DELHI AT NEW DELHI

+                  FAO 526/2011& CM 22036/2011(stay)

%                                                           17.02.2014

      INDIABULLS SECURITIES LTD.                ..... Appellant
                   Through Mr. Naveen Chawla, Ms. Solani Jaitley,
                   Ms. Meha Jain, Mr. Bhaskar Subramanan,
                   Advocates


                          versus



    SUNIL KUMAR HARGUNANI & ORS.                ..... Respondents

(name not given).

CORAM:

HON'BLE MR. JUSTICE VALMIKI J.MEHTA

To be referred to the Reporter or not?

VALMIKI J. MEHTA, J (ORAL)

1. This matter was passed over once on the request of respondent no. 1.

Again when the matter is called out after a pass over only a proxy counsel

appears on behalf of respondent no. 1 and says that one of the counsels

representing the respondent no.1 is not well. In my opinion, if one of the

counsels for respondent no.1 is not available, the other counsel should have

come.

2. This appeal impugns the judgment dated 25.8.2011 by which the court

below dismissed the objections under Section 34 of the Arbitration and

Conciliation Act, 1996 awarding damages/compensations to the respondent

no. 1 herein.

3. Learned counsel for the appellant presses only one point that taking

the appellant is guilty, however, an entitlement in law is only compensation

for loss suffered which has to be proved and quantum of loss is not proved

before the arbitrator. It is argued that in the present case for the loss which

is allegedly suffered by respondent no. 1, no evidence whatsoever, much less

any documentary evidence, was filed before the arbitrator to come to the

conclusion that the loss suffered by respondent no. 1 is a sum of Rs.

3,60,000/- for being claimed and awarded.

I may state that it is settled law that losses once are claimed to have

been caused, they have to be proved, before the monetary figure of loss as

claimed is awarded. Since, in the present case, absolutely no evidence

whatsoever including of the differences in prices causing loss on account of

sale of shares to the respondent no. 1 was led in the arbitration proceedings,

the impugned Award is illegal and hit by Section 73 of the Contract Act,

1872. An Award which is against law is hit by Section 25(a) of the

Arbitration & Conciliation Act, 1996.

4. In view of the above, the appeal is allowed and the matter is remanded

back to the arbitrator specifically limited only for the purpose of allowing

the parties to lead evidence with respect to the quantum of loss caused to the

respondent no. 1. Parties in terms of this judgment will now approach the

concerned department of the National Stock Exchange dealing with the

arbitration so that the matter may be referred to the same arbitrator who

passed the Award dated 12.4.2010 or to other arbitrator if the arbitrator Sh.

Vijai N. Mathur, who passed the Award dated 12.4.2010 is not available.

Parties are left to bear their own costs.

VALMIKI J. MEHTA, J

FEBRUARY 17, 2014 godara